Texas’ chief oil-and-gas regulator honored by oil-and-gas industry

Friday

Texas’ chief oil and gas regulator is trumpeting that she has been honored for her regulatory leadership — by none other than a faction of the industry she is charged with overseeing.

In a news release sent out Wednesday, the office of Christi Craddick, the chairwoman of the state oil and gas regulatory agency, says she is being recognized by the Texas Independent Producers and Royalty Owners Association as the organization’s 2018 Hats Off Award recipient.

The award, presented on Tuesday in Houston at the association’s annual convention, is the group’s highest honor.

The news release says Craddick, who is an elected member of the Texas Railroad Commission and who has long counted members of the oil and gas industry as her chief donors, was honored for "ensuring safe, responsible energy production in Texas, while reducing or removing unnecessary regulatory barriers that can restrict job growth and the energy industry’s significant impact on the Texas economy."

The Texas Railroad Commission regulates oil and gas operations.

In the release, Craddick, who hails from Midland, said she was honored to receive the award.

"The energy industry is a cornerstone of the Texas economy, and the Railroad Commission works to maintain a regulatory environment that ensures environmental protection and economic growth," she said. "Whether it’s through modernization of the agency’s IT systems, working with the Legislature to fund more inspectors or eliminating antiquated regulations, we are constantly looking for ways to better serve Texas."

Receiving the award is "unseemly, but it’s in keeping with what we expect from the Railroad Commission," said Adrian Shelley, the director of the Texas office of Public Citizen.

The agency is "widely known as a captive agency," he said.

He added: "I will say that as trade organizations go, the independent producers and royalty owners, concerned about protecting landowners, is not the American Petroleum Institute" — a trade association for major energy companies.

"Certainly regulators should have close relationships with those who are regulated, but not to the extent they create the appearance of bias or undue influence. The awards and pageantry are in keeping with overly-friendly, intertwined relationships our agencies have with the oil and gas industry," Shelley said.

Craddick is running for re-election. In an interview with the American-Statesman ahead of the March primary — which she won handily — she said she is not beholden to special interests.

"I grew up in Midland," she said. "I understand the oil and gas industry, and I think that’s an important perspective for this agency. I don’t have any conflicts of interest. I have mineral interests that my family and I own, but we don’t as an agency regulate mineral interests. I report everything fully with the ethics commission."

As of late February, she had $1.4 million on hand. She will face Democrat Roman McAllen, a historic preservation officer in Denton, in November; McAllen had $225.55 on hand in late February.

UPDATE: Allen Gilmer, chair of the Texas Independent Producers and Royalty Owners Association, sent in this note:

First, let me thank you for recognizing our highest award celebration in your coverage. TIPRO was founded in 1947 by several independent oilmen, including the role model for Jett Rink in the book and movie "Giant", Glenn McCarthy, also known for building and owning the legendary late Shamrock Hilton in Houston, Texas. It was formed by these pesky independents who felt, correctly, that the postwar Federal Government was colluding with Big Oil to drive Small Oil out of business. These small operators were naturally allied with the millions of individual property owners who owned minerals in the state, thus the name.

Since that time, TIPRO has been a fierce defender of both the independent oil and gas producer, more often than not multi generation family companies that live in the towns close to where they produce, and where they know the mineral owners that are supported by their investments and drilling. Yes, some of these folks have built multibillion dollar business along the way, since it was these folks that were the true pioneers of shale production through the novel use of hydraulic fracking, a 60 year old technology. It was these folks that created, out of thin air, the trillions of dollars worth of wealth that benefits Texas predominately, accounting directly for seven percent of the State budget, and indirectly over 20 percent and makes Texas, alone in the US, a financially viable state. In addition our folks are also responsible for over 90 percent of the State’s Rainy Day Fund.

TIPRO led the charge Statewide for implementing regulations that bonded and implemented the mechanism to fund, out of production from all operators, to pay for the plugging and abandonment cost of a previous generation of operators that had no such financial obligation. This responsibility, incidentally, is NOT required of other forms of energy such as wind, with effective lifespans LESS than typical oilwells. In other words, we created Good Neighbor standards for operations forward and paid for the messes of the less responsible operators and pushed for the legislation that binds us to these principles. We also sat on an oversight board that made sure our State Agencies spent that money the way they were supposed to, and it’s good we did, because smart folks in the state agencies figured out how to spend that money for things for which it was not intended. The legislature followed up by fixing the loophole.

All in all, the regulatory agencies in Texas like and respect the industries they regulate. While we don’t always see eye to eye, our industries are complex industries and we have been blessed to have highly qualified, knowledgeable and rational people running them. Their job is to insure that these businesses run efficiently while protecting and balancing the other overlapping interests. What that means is they frame the problems, and we all work together to formulate cost effective solutions instead of punitive action.

It’s sad that our own federal regulatory agency, the EPA, touts the progressive and successful efforts of the United States to reduce emissions, at the anti-oil and gas organizations can’t even fathom the thought. Who actually believes the tired old rubric of "People VS Business"? People trade. Always have and always will. It’s been good for all of us. If Public Citizen gives awards to fantastic servitude to society, we would like to nominate our organization, TIPRO, or any number of our members.

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